Correlation Between Ecofin Global and Allianz Technology
Can any of the company-specific risk be diversified away by investing in both Ecofin Global and Allianz Technology at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Ecofin Global and Allianz Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecofin Global Utilities and Allianz Technology Trust, you can compare the effects of market volatilities on Ecofin Global and Allianz Technology and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Ecofin Global with a short position of Allianz Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecofin Global and Allianz Technology.
Diversification Opportunities for Ecofin Global and Allianz Technology
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ecofin and Allianz is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Ecofin Global Utilities and Allianz Technology Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allianz Technology Trust and Ecofin Global is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Ecofin Global Utilities are associated (or correlated) with Allianz Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allianz Technology Trust has no effect on the direction of Ecofin Global i.e., Ecofin Global and Allianz Technology go up and down completely randomly.
Pair Corralation between Ecofin Global and Allianz Technology
Assuming the 90 days trading horizon Ecofin Global Utilities is expected to under-perform the Allianz Technology. But the stock apears to be less risky and, when comparing its historical volatility, Ecofin Global Utilities is 1.48 times less risky than Allianz Technology. The stock trades about -0.01 of its potential returns per unit of risk. The Allianz Technology Trust is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 20,550 in Allianz Technology Trust on September 14, 2024 and sell it today you would earn a total of 21,000 from holding Allianz Technology Trust or generate 102.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Ecofin Global Utilities vs. Allianz Technology Trust
Performance |
| Timeline |
| Ecofin Global Utilities |
| Allianz Technology Trust |
Ecofin Global and Allianz Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecofin Global and Allianz Technology
The main advantage of trading using opposite Ecofin Global and Allianz Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecofin Global position performs unexpectedly, Allianz Technology can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Allianz Technology will offset losses from the drop in Allianz Technology's long position.| Ecofin Global vs. Eastinco Mining Exploration | Ecofin Global vs. Dolly Varden Silver | Ecofin Global vs. LPKF Laser Electronics | Ecofin Global vs. Park Hotels Resorts |
| Allianz Technology vs. Sunny Optical Technology | Allianz Technology vs. Made Tech Group | Allianz Technology vs. Check Point Software | Allianz Technology vs. Celebrus Technologies plc |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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